I. Event Timeline, Involved Domestic Companies, and Key Details of the Final Ruling
1. Complete Case Timeline
April 3, 2025: EU-based chemical company INEOS Solvents SA filed an anti-dumping complaint regarding BDO, alleging that low-priced BDO imports were undermining local production capacity.
June 6, 2025: The EU formally initiated an investigation into dumping and injury to the domestic industry.
February 6, 2026: Provisional anti-dumping duties were implemented; domestic exports were already significantly hindered.
June 24, 2026: The EU issued an affirmative final ruling; fixed anti-dumping duties were imposed permanently starting June 25.
August 5, 2026: Statutory deadline for the expiry review of these anti-dumping measures.
2. Final Duty Rates for Domestic BDO Companies
1). Wanhua Chemical (Sichuan) Co., Ltd.: 113.7% (highest rate across all categories)
2). Xinjiang Markor Chemical Industry Co., Ltd.: 105.6%
3). Yuanli Chemical Group Co., Ltd., Inner Mongolia Dongjing Bio-Environmental Protection Technology Co., Ltd., Henan Kaixiang Fine Chemical Co., Ltd., Xinjiang Lanshan Tunhe Technology Co., Ltd., and other cooperating enterprises: 107.5% (uniform rate)
4). Other small and medium-sized domestic BDO enterprises (not individually disclosed): Subject to a uniform, high general tariff range.
Comparison with overseas production regions: Saudi Arabia (52.4%) and the USA (135.7%–142.5%). Domestic tariff rates are significantly higher than those for Middle Eastern supplies, resulting in a complete loss of price competitiveness in the EU market.
3. Key Rationale for the EU Ruling
1). It was determined that significant distortions in costs and prices existed in the domestic market; Brazil was used as a surrogate country to calculate "normal value," resulting in a very high calculated dumping margin.
2). EU-based BDO production facilities were operating at less than 40% capacity, with profitability and cash flow steadily deteriorating; the EU concluded that large-scale imports of low-priced Chinese BDO caused material injury to the domestic industry.
3). Downstream TPU and PBT enterprises raised objections, arguing that high tariffs would drive up raw material costs and weaken the export competitiveness of European finished products; however, the EU maintained the tariff plan to restore fair competition within the bloc, permitting tariff-free sourcing only from South Korea and Taiwan.
II. SunSirs Benchmark Prices Across the Industry Chain (June 30 vs. June 1)
Upstream Production Raw Materials (Core BDO Feedstocks)
1. Methanol (Core feedstock for the Reppe process)
June 30 benchmark: 2,342 RMB/ton; June 1: 2,478 RMB/ton (down 5.49% for the month); raw material demand was dampened by the chemical industry's off-season.
2. Calcium Carbide (Supporting material for the Reppe/acetylene process)
June 30 average ex-factory price: 3,160 RMB/ton; June 1: 3,295 RMB/ton (down 4.10% for the month); demand from power plants and PVC producers was weak.
3. Maleic Anhydride (Feedstock for the maleic anhydride process)
June 30 SunSirs benchmark: 7,500 RMB/ton; June 1: 7,962.5 RMB/ton (down 5.81% for the month); downstream demand for resins was sluggish.
Midstream Core Product: 1,4-Butanediol (BDO)
June 30 SunSirs composite benchmark: 7,720 RMB/ton; June 1: 8,095 RMB/ton (down 4.63% for the month).
Mainstream spot prices for bulk shipments in East China ranged from 7,650 to 7,750 RMB/ton; the industry continued to operate at a loss, while export barriers further suppressed upward price momentum. Key Downstream Products (Full BD Downstream Chain)
Spandex
Average price on June 30: 38,600 RMB/ton; June 1: RMB 40,150 (monthly decline of 3.86%); insufficient garment orders for both domestic and export markets.
III. Multiple Impacts of High EU Anti-Dumping Duties on the Domestic BDO Industry
1. Direct export channels effectively closed; export volumes shrank drastically
The EU market accounts for approximately 22% of total domestic BDO exports. Combined with the cancellation of export tax rebates for BDO starting in April, the total cost of exporting domestic BDO to the EU has doubled, resulting in a complete loss of price competitiveness. Exports to the EU totaled only 2,900 tonnes from January to April 2026—a year-on-year drop of over 85%. Large volumes of cargo originally destined for Europe were forced back into the domestic market, exacerbating the pressure of local oversupply. Low-priced BDO from Saudi Arabia has shifted toward Southeast Asia and Europe, further diverting overseas orders and making it increasingly difficult for domestic enterprises to expand internationally.
2. Intensifying domestic oversupply puts downward pressure on spot prices
Total domestic BDO capacity approaches 5.8 million tons, with nearly 2.35 million tons of new capacity scheduled for 2026–2027; the industry already suffers from chronic overcapacity. With export channels obstructed, diverted export volumes have flooded the domestic market, causing factory inventories to accumulate. Even though multiple plants underwent maintenance in June—driving operating rates down to a yearly low of 47.5%—this was insufficient to fully absorb the diverted supply; prices have continued to weaken, and the entire industry is operating at a loss.
3. Divergent business performance; high-cost SMEs face accelerated exit
Large integrated enterprises—such as Wanhua Chemical, Meike, Lanshan Tunhe, and Yuanli—have managed to keep losses relatively controlled by leveraging their own captive calcium carbide and methanol production. In contrast, small and medium-sized BDO plants lacking upstream integration face higher raw material costs and blocked export channels; their cash flows remain under strain, posing a long-term risk of shutdown or elimination, while industry concentration continues to rise.
4. Two key directions for forced industry chain transformation
1). Market diversification: Enterprises are shifting away from the European market to ramp up expansion in Southeast Asia, the Middle East, and Latin America, thereby circumventing trade barriers imposed by Europe and the US.
2). Process upgrading: Accelerating the rollout of bio-based BDO capacity to build differentiated competitiveness through low-carbon processes and avoid trade friction associated with traditional fossil-based products.
3). Downstream integration: Extending operations into upstream raw materials and downstream PBT/PBAT/TPU production to reduce reliance on standalone BDO sales.
5. Downstream products face indirect pressure
European PBT and TPU manufacturers can source tariff-free BDO from South Korea and Taiwan, resulting in production costs lower than those of Chinese plastic raw material exports. Consequently, Chinese PBT and TPU finished goods have lost competitiveness in the European market, creating a ripple effect that impacts exports across the downstream plastics and spandex industry chains. IV. Comprehensive Analysis of Domestic BDO Spot Supply, Demand, and Price Trends (as of June 30)
(I) Supply Side: Maintenance Provides a Floor, but Influx of Exported Cargo Offsets Support
1. Bullish Factors: Rotating maintenance at multiple plants in June—including Xinjiang Meike, Xinye, Shuguang Lvhua, and Inner Mongolia Sanwei—pushed industry operating rates to a yearly low. Weekly circulating volume contracted to 57,000 tons, alleviating the oversupply to some extent.
2. Core Bearish Factors: EU anti-dumping measures and the cancellation of export tax rebates led to a continuous influx of overseas cargo back into the domestic market. Domestic factory inventories steadily accumulated, and suppliers showed a strong willingness to lower prices to move stock, effectively offsetting the bullish impact of maintenance shutdowns.
3. Long-term Capacity Pressure: New BDO plants are scheduled to come online in the second half of 2026; the pattern of medium-to-long-term oversupply remains difficult to alter.
(II) Demand Side: Synchronized Off-Season Across Downstream Sectors; No Incremental Pull
1. Textile Chain (PTMEG-Spandex): Summer apparel and home textiles entered the traditional off-season; weaving plants continued to reduce operating loads, spandex operating rates declined, and BDO consumption contracted month-on-month.
2. Plastics Sector (PBT/TPU): Orders for automotive parts, home appliance casings, and films remained lackluster; processors purchased on an as-needed basis rather than stocking up in advance.
3. Biodegradable Plastics (PBAT/PBS): It was the off-season for express delivery and packaging; downstream masterbatch plants held high inventories, limiting raw material procurement.
4. Pharmaceutical and Electronic Solvents (THF): Essential demand remained stable, but due to their small share of total volume, they could not drive overall demand.
(III) Price Transmission Logic Across the Supply Chain
1. Upstream Transmission: Methanol, calcium carbide, and maleic anhydride prices all trended downward in June, slightly lowering BDO production costs and theoretically creating room for price reductions. However, as most plants were already operating below the cost line—where low-price sales would exacerbate losses—suppliers were inclined to hold prices firm, resulting in a smaller price decline compared to upstream raw materials.
2. Transmission from midstream BDO to downstream sectors: While monthly BDO prices fell by 4.63%, downstream products—PTMEG, PBT, and TPU—declined in tandem. Weak end-market consumption prevented downstream manufacturers from passing on costs, leading to continued margin compression across the entire supply chain and the spread of losses from the BDO segment to downstream sectors.
3. Impact of trade dynamics: EU tariffs raised costs for competing overseas products, while low-priced BDO from Saudi Arabia captured overseas markets, forcing domestic supplies to be sold locally; a loose supply-demand balance suppressed price levels across the entire chain.
(IV) Trading atmosphere on June 30
Traders faced significant inventory pressure and proactively lowered quotes to attract inquiries; downstream processing plants limited purchases to fulfilling monthly long-term contracts for essential needs, resulting in minimal spot trading and a sluggish market. Regional disparities were evident: integrated plants in the Northwest maintained relatively stable shipments, whereas the trading hubs in East China saw abundant supply and lower price quotes.
(V. ) Global BDO Market Landscape
Overseas Markets
1. European Union: Local producers like BASF and INEOS planned to increase operating rates, supplementing local supply with low-tariff Saudi material; falling raw material costs for European downstream sectors led to a long-term decline in demand for Asian BDO.
2. Saudi Arabia (Middle East): BDO faced a tariff of only 52.4%, offering a significant cost advantage; large volumes were diverted to Europe and Southeast Asia, continuously squeezing China's export share.
3. Southeast Asia: A key region for replacing domestic exports, though local plans for new BDO capacity suggest intensifying competition in the long term.
4. North America, Japan, and South Korea: Supply and demand were basically balanced with diverse import options, resulting in low reliance on domestic supplies.
Domestic Market
China holds the world's largest production capacity, yet faces dual pressure from severe overcapacity and overseas trade barriers. In the short term, supply is tightened periodically through concentrated maintenance shutdowns; in the long term, the industry relies on absorbing excess capacity through growth in downstream sectors like biodegradable plastics and high-end electronic consumables. Export focus has shifted from Europe to Southeast Asia, the Middle East, and South America, while the industry accelerates the adoption of bio-based, low-carbon processes to enhance global competitiveness.
(VI). Forecast of Future Market Trends by Phase
Maintenance shutdowns are ongoing, but the continued influx of material returning from Europe is suppressing the market; BDO prices remain range-bound at a weak 7,600–7,800 RMB/ton.
Support factors: Low industry operating rates, raw material costs at the floor, and new essential demand for bio-based products;
Pressuring factors: High EU tariffs, accumulation of domestic inventory, and the traditional off-season for downstream sectors.
Long-term steady growth in biodegradable plastics, lithium-ion battery solvents, and high-end electronic consumables will gradually absorb excess capacity;
Key variables: EU anti-dumping policies, the pace of domestic capacity expansion, the commissioning schedule for bio-based BDO, and consumption cycles in downstream textile and automotive sectors;
Overall outlook: BDO prices will likely fluctuate within a low range throughout the year; a sustained unilateral price surge is unlikely, and the industry will remain in a loss-making state until the supply-demand balance improves substantially.
SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.
